Bargain Sale To A Charitable Organization

AAA

DEFINITION of 'Bargain Sale To A Charitable Organization'

The sale of a good or service to a charitable organization for less than the fair market value of the good or service received.

Bargain sales are often used by donors who wish to make a charitable donation to an organization in a form other than cash. In some cases, the property transferred is exchanged for other similar property of lesser value, and the difference is considered a gift.

INVESTOPEDIA EXPLAINS 'Bargain Sale To A Charitable Organization'

If the property being sold has appreciated in value, the cost basis must be divided proportionately between the portion of the property that is actually sold and the remainder that is donated. The gain on the portion of the property that is sold must then be reported as income. The donation portion is written off, within the limits of charitable contributions for appreciated property.

RELATED TERMS
  1. Fire Sale

    Selling goods or assets at heavily discounted prices. Fire sale ...
  2. Distressed Sale

    When property, stocks or other assets are sold in an urgent manner, ...
  3. Sale

    1) In general, a transaction between two parties where the buyer ...
  4. Private Foundation

    A charitable organization that, while serving a good cause, does ...
  5. Qualified Charitable Organization

    A nonprofit organization that qualifies for tax-exempt status ...
  6. Proof of Charitable Contributions ...

    Substantiation required by the Internal Revenue Service for a ...
Related Articles
  1. Taxes

    Cut Your Tax Bill With Donor-Advised Funds

    Beat the tax man come April 15 by investing in a charity-friendly fund.
  2. Taxes

    Deducting Your Donations

    Generosity may be its own reward, but some charitable giving also provides personal tax benefits.
  3. Retirement

    Gifting Your Retirement Assets To Charity

    There are several things to consider when it comes to this type of charitable giving. Make sure you're well informed.
  4. Top fund-raising strategies for nonprofit organizations
    Taxes

    Top Fund-Raising Strategies For Nonprofits

    Top fund-raising strategies for nonprofit organizations
  5. Did you know basketball and volleyball were invented by instructors at a charity?
    Taxes

    The Top Nonprofit Organizations

    Did you know basketball and volleyball were invented by instructors at a charity?
  6. Taxes

    Changes In Tax Legislation And Regulation

    Keeping on top of these amendments can help you avoid penalties and take advantage of benefits.
  7. Investing

    Can I donate stock to charity?

    Giving stock, instead of cash, as a donation can greatly benefit both parties. You will find that most charities, hospitals, schools and other nonprofit organizations will accept stock as a gift ...
  8. Home & Auto

    Using Life Insurance To Make Charitable Donations

    Your life insurance policy can be a great tool for charitable giving. Find out how.
  9. 10 Steps To Tax Preparation
    Taxes

    10 Steps To Tax Preparation

    Follow these simple steps to get you ready for the income tax deadline of April 15.
  10. One of the first things to consider when selecting a charity to support is how strongly you feel about the cause.
    Personal Finance

    How to Pick a Charity

    The increasing number of charitable organizations mean the competition is fierce for your charitable dollars. Use these tips to research before donating.

You May Also Like

Hot Definitions
  1. Commodity

    1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often ...
  2. Deferred Revenue

    Advance payments or unearned revenue, recorded on the recipient's balance sheet as a liability, until the services have been ...
  3. Multinational Corporation - MNC

    A corporation that has its facilities and other assets in at least one country other than its home country. Such companies ...
  4. SWOT Analysis

    A tool that identifies the strengths, weaknesses, opportunities and threats of an organization. Specifically, SWOT is a basic, ...
  5. Simple Interest

    A quick method of calculating the interest charge on a loan. Simple interest is determined by multiplying the interest rate ...
  6. Special Administrative Region - SAR

    Unique geographical areas with a high degree of autonomy set up by the People's Republic of China. The Special Administrative ...
Trading Center